Molecular mechanisms in embryogenesis of the amphibian Xenopus laevis and the zebrafish have been studied. The mRNA for the mesoderm inducer activin is absent from oocytes but abundant in follicle cells. Since activin protein occurs in the embryo, activin may be imported into the oocyte from the follicular layer. Inducing factors like activin elicit the expression of regulatory genes in specific patterns. The LIM class homeobox gene Xlim-1 is regulated by activin and retinoic acid and is expressed in three lineages: (1) The dorsal mesoderm during gastrulation, an area know as Spemann's organizer. Expression in this area is responsive to activin. (2) The pronephros. (3) Specific regions of the CNS. Expression in regions 2 and 3 is sensitive to RA, and depends on ectoderm- mesoderm interactions during and after gastrulation. The related genes Xlim-2 and Xlim-3 have been isolated and characterized; Xlim-3 displays a highly restrictive pattern in neural and neuroendocrine tissues. LIM genes have been isolated from the zebrafish and, in collaboration with H. Westphal, from the mouse; they are highly homologous in sequence and expression pattern to the Xenopus genes. Transcriptional regulation of the Xlim-1 gene has been studied by injecting fusion constructs into the embryo. Animal explants derived from such embryos expressed the fusion construct very weakly unless stimulated by activin. Thus, the normal activin responsiveness of the Xlim-1 gene has been reconstructed, allowing the study of the putative activin response element of this gene. Studies on the formation of the nervous system focused on two projects. First, the role of RNA-binding proteins was studied by continuing the analysis of the nrp-1 gene and by isolating additional nervous system-specific genes that encode RNA binding proteins. Second, the relative importance of planar as opposed to transverse signals in neural induction was tested. Results obtained with embryos in which gastrulation movements were inhibited suggest that transverse induction is the dominant form of signaling in the formation of the nervous system.